Tag: Federal Order Hearing

FMMO Modernization Needs to Move – And So Does the Class I Mover

Posted on by Theresa Sweeney

The long, patience-testing — and absolutely necessary – Federal Milk Marketing Order hearing is nearly over.

The longest-ever USDA federal order hearing ended last Tuesday, after roughly 12,000 pages of testimony and nearly two dozen separate proposals considered. Through it all, NMPF’s impressive unity never faltered – our plan remains the most comprehensive, coherent, and compelling plan for modernization of a system that’s showing its creaks after a generation.

Now, the next phase of the arduous process of amending federal orders begins, as USDA begins considering the hearing record and hearing participants have 60 days to elaborate and defend their positions. USDA, of course, will have the final say in crafting its own proposal, but we’re confident our plan will remain the basis of progress, and we look forward to adding information and reinforcing our own arguments in the weeks to come. It’s critical to keep in mind that any plan designed to have national support needs to address diverse interests. That’s why our comprehensive plan covers areas ranging from the Class I price surface and make allowances to component pricing formulas and forward contracting.

One area that’s so important that we’re seeking resolution in the quickest manner possible is the Class I mover, which sorely needs to go back to the “higher-of” formula that served farmers well before the current “average of” approach took effect in 2019.

Processor interests aggressively pushed for the change to the mover in the 2018 Farm Bill. At the time, the adjustment seemed reasonable for farmers too, based on data going back to 2000. However, the lessons of the COVID-19 pandemic, and the current prolonged spread between the Class III and Class IV prices, have shown how poorly the current mover works for farmers in today’s agricultural environment. Milk producer losses are growing, with the amount of money taken from their milk checks soon to surpass $1.2 billion by April – all because of a system that now limits risks for processors while putting potentially unlimited losses on farmer backs.

This is unacceptable, a reality the hearing only made more obvious. While processors continually talked about how important the current mover is for their risk management strategies, no one in months of testimony ever presented definitive proof that such risk management is occurring at any meaningful level. Meanwhile, the processors continue to rake in dollars that would have gone to farmers – and will keep raking it in, by the way, until the mover is changed, a potentially huge financial incentive to work against positive changes for dairy farmers.

Knowing that the current mover isn’t defensible, these groups have suggested a modification to the current approach that’s largely based on a proposal that NMPF developed in 2021 under dire straits, but processors rejected. Their plan would adjust the mover in a backward-looking fashion that would allow farmers to recoup losses years after the fact. That reduces losses over the long term, but it’s cold comfort to farmers whose operations are struggling to live month-to-month and don’t have two years to be made right again. Moreover, it’s now clear that the losses farmers suffered in 2020 were not a one-off fluke.

And thus, given the current difficult times on dairy farms, we’re now pushing hard for the return to the higher-of. It responds quickly to the marketplace, it helps farmer cash flow, it’s simple to understand, and it would have no real impact on processors who are using the formula to boost their immediate balance sheets, not manage future risk as they claim.

Dating to NMPF’s first internal discussion, our path toward FMMO modernization is now nearly three years old. This final year, which, should all required timelines be met, would result in a producer vote roughly one year from now, is the most critical. It’s when, after all the research and talking, USDA will propose a new approach – and farmers will decide. These decisions are likely to shape the future of dairy for the next generation. We are excited to continue our leadership in this critical area, and will, as always, fight for the best approaches to ensure that dairy farms prosper.

Gregg Doud

President & CEO, NMPF

 

NMPF Statement at FMMO Hearing Conclusion

Posted on by Theresa Sweeney

From Gregg Doud, President and CEO, National Milk Producers Federation:

“NMPF spent more than two years preparing for USDA’s Federal Order hearing, and that preparation paid off. Our proposals, unanimously supported by our Board of Directors, reflect farmer unity and a good-faith effort to build industry consensus. After five months, 12,000 pages of testimony, and almost two dozen separate proposals considered, our plan remains the most comprehensive, coherent, and compelling framework for modernizing a system that’s badly in need of improvement.  We look forward to working with USDA and the entire industry in the weeks and months to come, noting that any plan USDA designs will by necessity require complex analysis to result in a proposal that serves diverse farmer needs well.

“In the meantime, we’ll continue to advocate for badly needed changes in areas such as the Class I mover. The current formula has cost farmers $1.2 billion in losses since its implementation after the 2018 farm bill, with additional losses expected in the coming months. It needs to change back to the previous “higher-of’ formula that served farmers best. The higher-of responds quickly to the marketplace, it helps farmer cash flow, it’s simple to understand, and it would have no real impact on processors who are using the formula to boost their immediate balance sheets, not manage future risk as they claim.

“Dating to NMPF’s first internal discussions, our path toward FMMO modernization is now nearly three years old. This final year is the most critical. We are excited to continue our leadership in this critical area, and will, as always, fight for the best approaches to ensure that dairy farms prosper.”

FACTS ABOUT NMPF’s FMMO PROPOSAL:

 

NMPF supports the federal legislation that authorizes the FMMO system, as well as improvements that increase clarity and producer understanding of milk pricing and ensure an orderly market and fair prices for dairy farmers.

NMPF’s proposed changes to the Federal Milk Marketing Order System include:

  • Returning to the “higher of” Class I mover;
  • Discontinuing the use of barrel cheese in the protein component price formula;
  • Extending the current 30-day reporting limit to 45 days on forward priced sales on nonfat dry milk and dry whey to capture more exports sales in the USDA product price reporting;
  • Updating milk component factors for protein, other solids and nonfat solids in the Class III and Class IV skim milk price formulas;
  • Developing a process to ensure make-allowances are reviewed more frequently through legislation directing USDA to conduct mandatory plant-cost studies every two years;
  • Updating dairy product manufacturing allowances contained in the USDA milk price formulas; and
  • Updating the Class I differential price system to reflect changes in the cost of delivering bulk milk to fluid processing plants.

For more information, visit here.

FMMO Hearing, Now USDA’s Longest, Drags Into 2024

Posted on by Theresa Sweeney

When USDA’s Federal Milk Marketing Order hearing reconvenes on Jan. 16, it will set a new record for the longest hearing in USDA history. NMPF’s proposals, however, have all been examined, with dairy cooperative leadership firmly stamped on testimony and cross-examination that will likely reach more than 15,000 pages by its expected conclusion on Groundhog Day, Feb. 2.

NMPF’s December focus was finishing region-by-region discussion on its final proposal, Proposal #19 to update Class I differentials. NMPF testimony concluded with analysis supporting the full range of NMPF proposals for comprehensive modernization offered by Dr. Scott Brown of the University of Missouri. Cooperative experts also explained both the need for updated differentials and the detailed analysis behind NMPF’s plan.

The final two weeks of presentations on the final three of 22 total proposals are scheduled for Jan. 16-19 and Jan. 29-Feb. 2, more than three months later than USDA’s originally projected completion date. The dragged-out hearing, largely because of an unexpectedly contentious atmosphere encouraged by exhaustive cross-examination by processor groups, may potentially cost farmers millions of dollars due to current inequities in the current, unmodernized system. Upon its conclusion, the next stage will be to create a legal brief, a written argument of NMPF’s case presented at the hearing to USDA using testimonies, exhibits, and cross-examinations.

For all the effort expended thus far, 2024 may be the most critical year of the entire FMMO modernization process that began with NMPF examination in 2021, as co-op leadership and farmer-owners lead the way in ensuring a final, adopted USDA proposal that heavily incorporates NMPF’s unanimously adopted, farmer-led, consensus and common-sense proposal for change.

Farm Bill Expires, Government Funding Doesn’t, and FMMO Hearing Soldiers On

Posted on by Theresa Sweeney

Uncertainty defined dairy in September, as the threat of a government shutdown and the impending expiration of the 2018 farm bill, occurring in the context of a slow-moving USDA hearing on the Federal Milk Marketing Order system, reminded dairy farmers of how much of the policy landscape operates outside their control, even as genuine progress continued in the areas that they could.

Five weeks into USDA’s FMMO hearing in Carmel, IN, a federal shutdown approached on Oct. 1, with government spending authority scheduled to lapse and NMPF experts and analysts readying for an indefinite hiatus in the hearing. Instead, an unexpected extension of funding for 45 days presents allow the hearing to continue USDA’s thorough examination of milk pricing, in which NMPF’s proposals have formed the foundation of discussion and remain the most compelling, comprehensive plan for milk pricing modernization.

“We had unanimous support from our board on our proposals” forged after two years of discussion, NMPF Senior Director of Economic Research & Analysis Stephen Cain said in a Dairy Defined podcast Sept. 18. “We have a well-rounded package that’s supported by the entire industry. So that’s the big piece here, again, is just making sure that we get everything we need to into the record to make sure the USDA has the right information they need to make the best decisions to make sure their orders are operating as effectively as they can.”

As October began, USDA had already heard testimony surrounding most major NMPF-identified topic areas, including the make allowance, milk composition and the Class I mover, and was moving into the Class I price surface, the last major topic of dispute among industry players. Through the hearing, NMPF’s years of preparation has paid off, with well-reasoned, factually grounded positions that work in tandem to help farmers in the entire industry. Opposing NMPF has been a motley crew of processor and niche-farmer interests touting proposals that largely benefit themselves.

For more information on the FMMO modernization effort, visit NMPF’s page on the FMMO hearing here.

As FMMO discussions progressed in Indiana, farm bill action in Washington remains elusive as legislation reauthorizing USDA programs expired Sept. 30. Farm bill expirations have ample historical precedent, with authorization often expiring before a new bill is approved. Agriculture committee lawmakers and NMPF continued to express optimism that a law can be passed before year’s end; if not, historical experience suggests that Congress may seek an extension of current law in late 2023 or early 2024, keeping farm-bill programs such as the Dairy Margin Coverage program in operation. NMPF staff continue to be heavily involved in discussions about both the shape and timing of the farm bill.

NMPF Economists Lead on Path to FMMO Modernization

Posted on by Theresa Sweeney
  • Led development of NMPF’s policy proposals to modernize the Federal Milk Marketing Orders.
  • Requested national order hearing to amend five pricing provisions, as agreed unanimously by the NMPF Board.
  • Developed testimony and gathered witnesses in support of the FMMO modernization efforts in advance of the hearing.

The Economics team this year has led NMPF’s efforts to modernize the Federal Milk Marketing Order system, a complex and critical component of the industry’s future.

After nearly two years of work and more than 200 virtual and in-person meetings, NMPF’s FMMO efforts reached another milestone August 23 on the long path towards implementation. with the start of the national USDA hearing in Carmel, IN. NMPF’s Chief Economist, Peter Vitaliano, providing the first testimony of any of the interested parties presenting at the hearing, expected to last six weeks. Vitaliano’s initial testimony laid out the context for NMPF’s full proposal before he focused on the rationale for updating the milk component factors in the skim milk price formulas, the first of National Milk’s five proposals to amend the FMMO pricing provisions.

Before the hearing concludes, Vitaliano will testify another four times on NMPF’s other proposals to ensure the FMMO better reflects current market conditions. Those additional four proposals recommend that USDA:

  • Discontinue use of barrel cheese in the protein component price formula
  • Return to the “higher-of” Class I mover
  • Increase make allowances in the component price formulas; and
  • Update the Class I differential pricing surface.

In addition to Vitaliano, experts from NMPF member cooperatives along with dairy farmer leaders will be testifying in support of NMPF’s proposals. Throughout the process, NMPF staff, attorneys, and consultant/FMMO expert Jim Sleper will remain actively engaged in formulating strategy to achieve the best possible outcome for U.S. dairy farmers and their member cooperatives. Economics has also assisted Government Relations in advocating for Farm Bill language to direct USDA to conduct mandatory plant cost studies every two years to better inform future make allowance discussions.

Beyond the extensive Federal Order work, the Economics team provided the analytical and administrative backbone to the Cooperatives Working Together program, supporting the export of more than 600 million pounds milk equivalent of dairy products through August of this year. Additionally, the team has been helping members and farmers stay ahead of the market, publishing 40 market reports and delivering over 35 presentations so far this year.

August Update: FMMO Hearing Underway; Margins Below $4

Posted on by Theresa Sweeney

NMPF capped an unusually busy August – traditionally a slower month in policy circles due to the congressional recess – with the beginning of the USDA Federal Milk Marketing Order hearing in Carmel, IN. The first comprehensive hearing on the FMMO system since 2000 is the result of more than two years of NMPF study, discussion and leadership, featuring more than 200 meetings and exhaustive, member-led examination of all issues as dairy farmers achieved overwhelming consensus behind its proposal.

That said, work is far from over. The first weeks of questioning and cross-examination have featured challenging questions regarding methodology, analysis and whether NMPF’s plan is best for the industry. Still, led by staff economists, cooperative efforts and dairy farmers, NMPF is entering September in a commanding position in a hearing that may last well into October.

“Thanks to the tireless efforts of dairy farmers and their cooperatives, this industry is poised for progress as Federal Milk Marketing Order modernization is now in sight,” NMPF President and CEO Jim Mulhern said in a statement on Aug. 23, the hearing’s first day. “NMPF’s comprehensive proposal for improvements to the system forms the basis of this hearing, and through our members’ depth of expertise and unmatched team of dairy farmers and cooperative analysts, we are prepared to advance our industry’s need for these updates.”

The FMMO hearing is occurring against a backdrop of the lowest producer margins since margin-protection insurance was introduced in the 2014 Farm Bill. The USDA announced that the July Dairy Margin Coverage margin dropped $0.13/cwt from June to $3.52/cwt. That will generate payments of $0.48/cwt payments for the free $4/cwt coverage level, and payments of $5.98/cwt for coverage the maximum $9.50/cwt Tier 1 coverage. The July all-milk price was $17.40/cwt, $0.50/cwt lower than in June, while the DMC July feed cost was $0.37/cwt of milk lower than June’s.

Available forecasts indicate the margin will increase rapidly during the following three months and stabilize around $9.50/cwt for the fourth quarter of this year.

In addition to FMMO activity, NMPF and the U.S. Dairy Export Council organized an Aug. 3 meeting for APEC agricultural officials as part of the larger APEC Food Security Ministerial session in Seattle as part of the federation’s ongoing engagement with the Asia-Pacific Economic Cooperation (APEC), an organization that includes 15 of the top 20 U.S. dairy export markets. Mulhern spoke to the value of an incentive-based, voluntary approach toward improving the sustainability of U.S. agriculture and highlighted the dairy sector’s leadership in implementing climate-smart solutions.

NMPF tangibly expanded U.S. dairy exports in August through the Cooperatives Working Together program. CWT member cooperatives secured 67 contracts, adding 6.3 million pounds of American-type cheeses, 2,000 pounds of anhydrous milkfat, 337,000 pounds of cream cheese and 137,000 pounds of whole milk powder to CWT-assisted sales in 2023. In milk equivalent, this is equal to 61.5 million pounds of milk on a milkfat basis. Sales for the year so far through August are the total milk equivalent of 610.5 million pounds on a milkfat basis.

NMPF’s regulatory team, meanwhile, noted progress in the Waters of the U.S. issue, with a new Biden Administration rule offered in line with a Supreme Court decision last spring that limited the reach of EPA’s regulatory authority. While the rule will almost certainly be subject to litigation, the approach is an improvement of the most recent changes to WOTUS, which created regulatory uncertainty for farmers and represented government overreach, a point regulatory staff have made in numerous meetings with and comments to EPA over more than a decade.

Finally, the final day of August saw USDA announce the fiscal year 2023 notice of funding for CIG On-Farm Conservation Innovation Trials, bringing to fruition an important win NMPF secured last year.

On-Farm Conservation Innovation Trials support widespread adoption of innovative approaches, practices, and systems on working lands. The Inflation Reduction Act, which Congress passed last year, doubled annual funding for this program from $25 million to $50 million for four fiscal years. NMPF won language in the law to target this new funding toward initiatives that use feed and diet management to reduce enteric methane emissions, which can comprise roughly one-third of a dairy farm’s greenhouse gas footprint and represent a major opportunity for dairy to lead the agriculture sector in making sustainability gains.

NMPF Eager for Next Steps in Milk Marketing Modernization with USDA “Action Plan”

Posted on by Theresa Sweeney

NMPF’s two-year effort toward Federal Milk Marketing Order (FMMO) modernization achieved a significant milestone June 1, when USDA released its proposed “Action Plan” to move toward a national hearing based on the organization’s proposal to update to FMMO system to benefit farmers, the cooperatives they own and the broader industry.

The next phase of creating a federal order system that better reflects today’s market conditions and dairy producer needs begins with an informational hearing June 16 that should serve as a prelude to a full formal hearing in late August, according to the plan. Should the entire process go smoothly, an updated FMMO system could be actively benefiting farmers in late 2024.

“We’re gratified that USDA recognizes the comprehensive nature of our proposal and are looking forward to it being considered in full, because the whole of our plan adds up to more than the sum of its individual parts,” said NMPF President and CEO Jim Mulhern. “We will bring the same level of dedication and preparation to this part of the process that we did in drafting our own plan, which included more than 150 meetings and wide consultation across dairy producers and the entire industry.”

NMPF’s Federal Milk Marketing Order proposal, detailed here, offers comprehensive solutions that recognize the needs of today’s dynamic industry. While the complexity of the process will require detailed discussions, the unity seen among dairy producers supporting NMPF’s proposal, which the organization’s Board of Directors approved unanimously, puts adoption on a positive path moving forward, since producers vote for Federal Orders, Mulhern said.

Randy Mooney, NMPF chairman and a dairy farmer near Rogersville, MO, called the proposal’s strong momentum a testament to the power of dairy farmers, through their cooperatives, to undertake bold initiatives that advance their industry. Farmers will continue to lead as modernization moves forward, Mooney said.

“Dairy producers have proven throughout this process that, with unity and careful attention to each other’s needs, we can achieve impressive things,” he said.  “Dairy’s strength comes from its farms, and producers ready to face challenges and seize opportunities. We’re excited to begin the formal hearing process.”

Milk-Pricing Modernization: Consensus Can Help Pick Up the Pace

Posted on by Theresa Sweeney

The thing about any long journey is, even after you’ve come a long way, you still more steps to take.

But with proper preparation and a clear plan, the rest of your journey may be smoother. That’s our hope now that we’ve submitted to USDA our comprehensive proposal for Federal Milk Marketing Order reform.

Without torturing the metaphor further by saying we have the wind at our backs, I will say that our disciplined approach has had encouraging results. More than 150 meetings over nearly two years, with many of the industry’s best minds, including producers of all sizes and in all regions of the country, as well as the cooperative-led processing community, has generated a strong consensus among producers that portends well for the proposal we’ve presented USDA. The Federal Milk Marketing Order system is, in the end, focused on farmers – and we’ve gained unanimity among our producer-leaders in backing this proposal.

And it’s not just us at NMPF. We deeply appreciate the collaborative spirit and helpful conversations we’ve had with numerous national, state and regional groups, including the American Farm Bureau Federation. Many of these groups have their own perspectives specific to their circumstances, and we’ve appreciated the good faith efforts to find consensus. Those conversations have made our proposal stronger as it’s deepened our producer support.

A lot of work has gone into this effort. We have examined the program in great detail and come up with a plan to modernize and update federal milk marketing orders so they can work better for today’s dairy industry. And it’s also important to note, to everyone involved, how much the elements of our proposal rely on one another to succeed.

Take the make allowance, for example – a key priority of our hearing request. That specific portion of federal orders, which helps cover processing costs, is of intense interest to some, but still needs to be addressed in a way that benefits all. The make allowance is important; it hasn’t seen a meaningful update in 15 years. But handling that issue in isolation would have the effect of reducing milk prices to farmers, a non-starter in a program that’s ultimately supported by a vote from producers.

And the make allowance is far from the only issue the USDA needs to address. That’s why we have the make allowance issue in our proposal, but as one of five provisions on which we’re seeking a hearing. Other necessary updates to milk pricing help economically offset our proposed make allowance adjustment, by bringing pricing formulas up-to-date and minimizing disruption to markets.

One example of a needed update is changes to formulas that are based on the composition of milk itself. Key pricing factors are tied to the protein, solids-not-fat and the other solids content of milk. The factors currently in use date to the late 1990s, before the last major change in the federal order program in 2000. A quarter-century later, the protein content, the solids-not-fat, and the other solids content of milk coming off the farm is higher. We need to adjust those factors, because they have an impact on the price that is reported and then, ultimately, paid to producers. That’s one issue.

Another example is Class I fluid milk pricing. Given the example of the pandemic, which showed how a change in the Class I pricing system we supported in the 2018 Farm Bill ended up placing too much price risk on farmers, we’re calling for a return to the “higher of” approach that priced milk off Class III and Class IV prices. While the pandemic exposed the problems with the new formula, the problems occurred last year as well, demonstrating the need to return to the “higher of.”

We’ve also updated the Class I differentials, a fixed price per hundredweight of milk, in each of the 11 federal orders around the country. The fluid market – the bottles of milk you see in the stores – is a higher-cost market to service, and farmers need a federal order system that more accurately reflects costs and manages risks than what we have today, rather than the environment of 2000, when the current Class I differentials were set. Updating differentials and returning to the higher of are key components of furthering the key purpose of the Federal Milk Marketing Order system – to ensure orderly milk markets nationwide.

Returning to the make allowance: While it’s clear that updates to make allowances are needed, it’s also become clear that a fair, lasting solution is going to require sound, higher quality data, from which we then can build producer consensus.

To move toward that outcome, we’re first proposing an interim increase in the make allowance of cheese, whey, butter and nonfat dry milk. This increase already has support from producers, who unanimously endorsed it at our NMPF annual meeting last October. But to go much  further on adjusting make allowances, we need to address the need for solid data, so we can make changes that reflect current conditions with greater certainty than what is now possible.

For that, we need to go to Congress to get authority for USDA to conduct a mandatory manufacturing cost survey. We are going to pursue that in the farm bill, through a provision from Congress that gives USDA the authority to do a mandatory, auditable survey of plants that are reporting their price information to USDA and get further information from them on their manufacturing costs.

By reporting that every two years to the industry, we then can have a mechanism to more regularly update make allowances going forward. That’s important for a truly modernized system. It’s also critically important to get it right, which is why we’re taking the path we’ve chosen.

Modernization of the Federal Milk Marketing Order system has been due for some time, and the pandemic experience, which exposed disorderliness in the system, underscored just how overdue this effort has been and created the necessary momentum for change. Yes, we’ve been deliberate – but we wanted solutions that had benefits for everyone, and we wanted to make sure that we addressed the concern that Agriculture Secretary Vilsack had stated, well over a year ago, when he said it was important to have consensus within the producer community.

We have achieved that consensus. I’ve been very heartened by the strong degree of support for the proposal that we submitted to USDA on Monday. To keep this momentum going, we now need to prepare to make the best case possible before USDA. And we’ll need to maintain the strong consensus we’ve achieved. That’s important for the best outcome, and it’s important for keeping the pledge we made at the outset to pursue modernization that leaves this industry better positioned to meet today’s – and tomorrow’s – challenges.

The key to a successful journey is to prepare well, anticipate the challenges in advance, go in with a plan, and execute that plan without wasting energy. We’ve been dedicated to those principles so far, and they will continue to guide this process. That’s not just how you reach a destination. It’s how you succeed – and in less time than others may have thought possible.

Thank you to everyone who has helped bring us this far. It’s time now to move forward.

 

Jim Mulhern

President & CEO, NMPF

 

NMPF Submits Milk-Pricing Plan to USDA, Moving FMMO Modernization Forward

Posted on by Theresa Sweeney

The National Milk Producers Federation (NMPF) today submitted to USDA its comprehensive proposal for modernizing the Federal Milk Marketing Order (FMMO) system, the product of two years of examination and more than 150 meetings held to build consensus behind updates to a program that last saw significant changes in 2000.

“Dairy farmers and their cooperatives need a modernized Federal Milk Marketing Order system that works better for producers,” said NMPF President and CEO Jim Mulhern. “By updating the pricing formulas to better reflect the value of the high-quality products made from farmers’ milk, by rebalancing pricing risks that have shifted unfairly onto farmers, and by creating a pathway to better reflect processing costs going forward, we are excited to submit this plan as a path toward a brighter future for dairy.”

Upon official acceptance, USDA will have 30 days to review the plan and decide whether and how to move forward with a federal order hearing to review the plan. Highlights include:

  • Updating dairy product manufacturing allowances (the “make allowance”) contained in the USDA milk price formulas;
  • Discontinuing the use of barrel cheese in the protein component price formula;
  • Returning to the “higher of” Class I mover;
  • Updating milk component factors for protein, other solids and nonfat solids in the Class III and Class IV skim milk price formulas; and
  • Updating the Class I differential price system to reflect changes in the cost of delivering bulk milk to fluid processing plants.

NMPF will pursue two other components of its Federal Order proposal, approved unanimously by the organization’s Board of Directors in March, outside of the federal-order hearing process, as they don’t involve changing federal order regulations. The recommendations, which remain essential parts of NMPF’s modernization plan, are:

  • Extending the current 30-day reporting limit to 45 days on forward priced sales on nonfat dry milk and dry whey to capture more exports sales in the USDA product price reporting, which can be implemented through federal rulemaking; and
  • Developing legislative language for the farm bill to ensure the make allowance is regularly reviewed by directing USDA to conduct mandatory plant-cost studies every two years.

Mulhern urged USDA to grant a hearing on the entire NMPF proposal, noting how the effectiveness of some components are dependent on the inclusion of others. Mulhern also thanked other organizations that have helped NMPF forge necessary producer consensus by sharing views and insights throughout the process, saying that spirit of unity and good-faith discussion will help FMMO modernization move forward more quickly.

“From state and regional dairy associations to the American Farm Bureau Federation, dairy farmers have had many allies and friends throughout this process,” Mulhern said. “As Secretary Vilsack has stated, consensus is necessary to successful modernization. We have that producer consensus, and we look forward to working together toward adoption and implementation of our plan.”